Posted on 10/06/2006 5:03:06 AM PDT by governsleastgovernsbest
by Mark Finkelstein
October 6, 2006 - 07:51
Paul Krugman teaches teaches economics at Princeton, and has done the same at MIT. Enron apparently thought enough of his understanding of the dismal science to hire him as a consultant - though Krugman has at times been reluctant to disclose that fact.
But judging by his latest anti-Wal-Mart jeremiad [subscription required] in this morning's New York Times, you really have to wonder if the good professor of economics . . . understands anything about capitalism. His portrait of Wal-Mart is a caricature of greedy management conducting what he calls a "war on wages." Krugman has apparently gotten hold of a couple leaked internal Wal-Mart memos that discuss ideas for keeping labor costs under control. Among the ideas: increasing the percentage of part-time workers, since they qualify for fewer benefits, and limiting raises for long-term employees.
Krugman suggests that the only thing that permits Wal-Mart to "impose" its "brutal strategy" is a legal climate, created by Republicans who "come down on the side of the wage-cutter," that makes unionization of Wal-Mart workers more difficult.
Can Krugman really believe this? You sense he is stuck in some kind of fantasy time-warp in which Wal-Mart managers are Monopoly-millionaire caricatures in silk top hats, cackling as they run their fingers through piles of gold pieces and dream up new wage-cutting schemes that they will "impose" on workers.
Has the Times columnist ever heard of something called . . . the free market? Wal-Mart can no more "impose" wages on workers than it can impose high prices on customers. All Wal-Mart can do is offer wages. If workers find the offer attractive, they will accept it, taking new jobs at Wal-Mart or remaining in the Wal-Mart jobs they already have. If other employers offer more attractive employment terms, workers will reject Wal-Mart's offer. Wal-Mart would then have to improve its offer until it is able to attract the number and quality of workers it seeks.
There is no such thing as a free lunch in the free market. If in the short run unions "succeed" in imposing higher-than-market wages, they ultimately threaten the competitiveness and even the survival of employers and the jobs they provide. See the plight of US automakers for a good example.
Wal-Mart is the nation's largest employer. When new Wal-Marts open, job-seekers tend to turn up in droves. Those facts are the best proof that - far from "imposing" below-market wages - Wal-Mart is offering opportunities better than what more than a million Americans have concluded they can find elsewhere.
Perhaps it's time for Prof. Krugman to give up teaching and take a crash course in Market Economics 101. Who knows? Perhaps Milton Friedman might even be willing to sit down with him for a while.
Finkelstein lives in the liberal haven of Ithaca, NY. Download podcasts and webcasts of Mark's award-winning TV show 'Right Angle' here. Contact Mark at mark@gunhill.net
NY Times/NewsBusters clueless-Krugman ping to Today show list.
Walmart will supposedly end their layaway program soon and offer a internet creditcard. Anyone else hear about that?
Wouldn't it be fun for Milton Friedman to critique Paul Krugman's opinions on WalMart?
It would. I'd like to think that my critique would earn a sold 'C+' from the great professor!
If you read Krugman's writing, you know that the interesting thing about Krugman is that he is a supporter of capitalism overseas. It's only in the US where he doesn't want capitalism.
And the reason is that he knows it works, and he wants to help 3d world nations, but he wants to burden the US with socialism while the 3d world is developing under capitalism.
I'd rather have a tarantula lay eggs in my ear.
Krugman is just another Marxist hack with a degree from a Marxist university hired by a Marxist newspaper to offer his Marxist editorials that rail against the enemy of Marxism, which is Capitalism.
Nothing more, nothing less.
Krugman is a "create a victim" socialist screeching from his ivory tower. Capitalism is the only economic system compatible with individual rights. Krugman would have a tough time earning a living outside of his socialist manufacturing conglomerate.
ping to post #3. Have you heard anything about that?
I just googled it - they're cutting it off November 19th. While we can afford to just go buy Christmas presents, many people can't, and they put everything on lay-away and make payments. It looks like Walmart wants to get those damn poor people the hell out of their stores (unless they're BEHIND the register, of course).
They're going to lose a lot of Christmas sales that way. Many people are willing to spend hundreds for Christmas gifts, but they'd never have all that money at once. So, in essence, they save up for it by using layaway. Now, those people will either find another way to save up for it or, more likely, they'll shop somewhere else that has layaway. From a business perspective, this was a really stupid idea.
I'm going to FIND something I want at K-Mart, and write Wal-Mart to tell them why they just lost all my Christmas shopping dollars.
http://www.kmartcorp.com/corp/story/pressrelease/news/pr060914a.stm
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